20211008Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANPER
COMMISSIONER R4PER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:DANIEL KLEIN
DATE:OCTOBER 7,2021
RE:THE 2019 BROADBAND EQUIPMENT TAX CREDIT APPLICATION
FOR LEADER COMMUNICATIONS,LLC;CASE NO.GNR-T-21-08.
BACKGROUND
In 2001,House Bill 377 was enacted authorizing income tax credit for the installation of
qualifying broadband infrastructure in Idaho.Idaho Code §63-3029B(3)(a)(ii).In particular,
Section 63-30291 allows a taxpayer to receive an investment tax credit for eligible broadband
equipment installed during a calendar year.
Qualified broadband equipment is defined as “those network facilities capable of
transmitting signals at a rate of at least 200,000 bits per seconds (bps)to a subscriber and at least
125,000 bps from a subscriber.”Idaho Code §63-3291(3)(b).If the equipment is installed by a
telecommunications carrier,it must also be “necessary’to the provision of broadband services
and an integral part of a broadband network.”Idaho Code §63-30291(3)(b)(i).To be eligible
for the tax credit,the taxpayer must obtain from the Commission an Order confirming that the
installed equipment meets the statutory definition of qualified broadband equipment.Procedural
Order No.28784 and Idaho Code §63-30291(4).Once the Commission has determined the
installed equipment is eligible for the broadband equipment tax credit,an order along with the
original Application is forwarded to the Idaho Tax Commission.
DECISION MEMORANDUM -I -OCTOBER 7,2021
THE APPLICATION
On August 30,2021,the Commission received an Application from Leader
Communications LLC (“Leader”or “Company”).seeking approval of the equipment for the
broadband tax credit installed during calendar year 2019.In the Application,Leader states that it
installed equipment associated with “delivering broadband internet to the residents and
businesses of Benewah,Latah,Cleanvater.Nez Perce,and Koolenai counties via wireless
microwave and some with fiber optics.”Leader discloses that its broadband network has data
transmission rates between I and 2Mbps for subscriber downloads and uploads,which exceeds
the required rates of 200,000 bits per second to a subscriber and 125,000 bits per second from a
subscriber.The Company asserts that 16%of its potential Idaho subscribers have taken their
broadband service.Leader invested approximately $177,772.88 in 2019 in qualif’ing broadband
equipment that it confirms is integral to the broadband network
STAFF REVIEW AND RECOMMENDATION
Staff has reviewed and audited the list of proposed broadband equipment and believes the
identified equipment qualifies for the investment tax credit pursuant to Procedural Order
No.28784 and Idaho Code §63-30291(3)(b).Staff,therefore,recommends that the Commission
issue an Order confirming the equipment is qualified broadband equipment and forward the
approving Order along with a copy of the original Application to the Idaho Tax Commission.
COMMISSION DECISION
Does the Commission wish to issue an Order confirming the equipment identified in Case
No.GNR-T-21-08 is qualified broadband equipment as defined in Idaho Code §63-30291(3)(b)
and forward it to the Idaho Tax Commission?
Daniel Klein
Udmemos/GNR-T-2 -082019 Leader Communications LLC Broadband Tax Credit
DECISION MEMORANDUM -2 -OCTOBER 7,2021